Archive for the 'Mortgage Reviews' Category
Mortgage Week in Review
October 27th, 2008 categories: Mortgage Reviews, Real Estate News
While the headlines were focused on the poor performance of the stock market, mortgage rates improved moderately during a volatile week. Mortgages rates were helped by a couple of factors. Seeking to reduce risk, investors sold stocks and moved the funds into relatively safer Treasury bonds and government guaranteed mortgage backed securities. In addition, slower economic growth and lower energy prices reduced expectations for future inflation. More good news for the housing market came from the September Existing Homes Sales report, which rose 5.5% from August to the highest rate since August 2007.
Another important development was a decline in Libor rates during the week. Libor rates are viewed as a primary indicator of credit market conditions. They are also an important benchmark for setting the rates on many consumer loans, including adjustable-rate mortgages. Libor rates shot higher during the credit crisis when financial institutions became reluctant to lend money to each other. The broad series of recent government actions brought Libor rates down closer to more normal levels.
The biggest event this week will be Wednesday’s Fed meeting. Investors have priced in a half-point rate cut, and they are waiting to see if the Fed will take any other actions to boost the economy. The most important economic data will be Thursday’s Gross Domestic Product (GDP) report. GDP is the broadest measure of economic activity. In addition, New Home Sales will come out today.Â
Brought to you by:Â Cameron Lewis, Beverly-Hanks Mortgage, Xinnix 2008 & MBSQuoteline
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Mortgage Week in Review
October 13th, 2008 categories: Mortgage Reviews
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 This week the stock market fell to the lowest level since 2003. Normally mortgage markets improve during a stock market decline, since Fannie Mae, Freddie Mac, and Ginnie Mae mortgage backed securities (the vehicles through which most mortgages made today are sold) are considered a relatively safe haven. This week, however, the prices paid for these securities moved lower as well. One reason is that some investment funds have been forced to reduce their leverage and sell nearly every asset class in their portfolios. Another factor is investor concern that the supply of debt will increase significantly as the government funds its rescue actions. Mortgage rates ended the week moderately higher. Investors viewed the $700 billion rescue plan passed last week as a necessary first step, but not an immediate solution to the credit crisis. Governments around the world took a variety of additional steps during the week to support the banking system. A historic coordinated interest rate cut from many central banks took place on Wednesday. The Federal Reserve lowered the Fed Funds rate by one half point to 1.50%, citing reduced inflationary pressures due to an economic slowdown and falling energy prices. The Fed Funds rate heavily influences short-term interest rates, but its impact on long-term mortgage rates varies based on inflation expectations. In this case, the Fed rate cut most likely helped move mortgage rates a little lower, but the factors described above had more influence.The decline in home prices was a major cause of the credit crisis, and stabilization in the housing market will be important to resolve the problems. Little noticed this week, August Pending Home Sales jumped 7% from July, far above the consensus for a small decline. They were 9% higher than one year ago and were at the highest level since June 2007. Pending Home Sales are a leading indicator for the housing market, meaning that the next Existing and New Home Sales reports may show increases. Investors will be closely watching future housing market data to see if the trend continues.
The Economic Calendar will be full next week. The Consumer Price Index (CPI) inflation report will come out on Thursday. CPI looks at the price change for those finished goods which are sold to consumers. The Producer Price Index (PPI) will be released on Wednesday. PPI focuses on the increase in prices of “intermediate” goods used by companies to produce finished products. Retail Sales is also scheduled for Wednesday. Industrial Production, an important indicator of economic activity, will be released on Thursday. Housing Starts will come out on Friday. Consumer Sentiment, the Philadelphia Fed index, and the Fed’s Beige Book will round out a busy week. Investors will also be watching for additional government actions to ease credit markets. Mortgage markets will be closed on Monday in observance of Columbus Day.
Brought to you by:Â Cameron Lewis, Beverly-Hanks Mortgage, Asheville, N.C. 828-258-1945 Office, 877-293-5946 Toll Free, clewis@beverly-hanks.com
Courtesy: MBS Quoteline & Xinnix
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Mortgage Week In Review
August 11th, 2008 categories: Mortgage Reviews
Mortgage Week In Review
In the housing sector, the June Pending Home Sales index rose 5% from May. Pending Home Sales are a leading indicator of future housing market activity, so the next Existing and New Home Sales reports may show increases. In addition, the chief economist of the National Association of Realtors (NAR) expects the recently passed Housing Bill to stimulate the housing market later in the year.
Next week, the Trade Balance will come out on Tuesday. Retail Sales is scheduled for Wednesday. Consumers account for about 70% of economic activity, and this report is a major indicator of spending levels by consumers. The Consumer Price Index (CPI) inflation data will be released on Thursday. CPI looks at the price change for those finished goods which are sold to consumers. Industrial Production, an important indicator of economic activity will come out on Friday. Consumer Sentiment and the
Courtesy of Xinnix and MBS Quoteline
Copyright @ 2008 MBSQuoteline
Cameron M Lewis
Beverly-Hanks Mortgage Services
Residential & Commercial Financing
828-258-1945 Office
877-293-5946 Toll Free
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Mortgage Week In Review
July 28th, 2008 categories: Mortgage Reviews
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 Happy Monday to everyone! Once a week my favorite mortgage man here at Beverly-Hanks, Cameron Lewis, puts out an excellent, to-the-point review of where the mortgage markets are going, or what’s happening in the financial markets that affects mortgages. I’m happy to share these with you on a weekly basis and you will find them most likely on Mondays or Wednesdays. If you have specific questions for Cameron, I will be including all of his contact information at the end of this article.
Besides providing support for Fannie and Freddie, the Housing Bill will also help the housing market in other ways. One program will allow the FHA to insure up to $300 billion in new loans targeted at troubled homeowners. Another program adds tax credits for first-time homebuyers, which in essence will be a 15-year interest free loan for up to $7,500. In addition, the bill provides funds for more low income housing and grants to be made for local community redevelopment. A wide range of smaller programs are included as well.
The economic news in the housing sector was mixed. June Existing Home Sales fell slightly, and inventory levels of unsold homes increased. In contrast, New Home Sales were significantly higher than expected in June, and the May figures were revised higher as well. High inventory levels will probably need to come down to achieve a meaningful recovery in the housing market, but the chief economist of the National Association of Realtors (NAR) believes that the Housing Bill will play a major role in helping the housing market to rebound. In particular, he expects the first-time homebuyer tax credit to boost future home sales.
Friday will be the big day next week. The important Employment report will come out that day. As usual, this data on the number of new jobs created, the Unemployment Rate, and wage inflation will be the most highly anticipated economic data of the month, since the health of the labor market is perhaps the single biggest factor in the performance of the economy. Early estimates are for a loss of 70K jobs in July.
The first reading of second quarter 2008 Gross Domestic Product (GDP) will be released on Thursday. GDP is the broadest measure of economic activity. The two national manufacturing indexes, the ISM and the Chicago PMI, will come out on Thursday and Friday. Consumer Confidence and Construction Spending will round out the schedule.
Cameron M Lewis
Beverly-Hanks Mortgage Services
Residential & Commercial Financing
828-258-1945 Office
828-231-4909
828-254-7202 Fax
877-293-5946 Toll Free
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